Willard Motors, Inc., employs 20 sales personnel to market its line of luxury automobiles. The average car

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Willard Motors, Inc., employs 20 sales personnel to market its line of luxury automobiles. The average car sells for $65,000, and a 6 percent commission is paid to the salesperson. Willard Motors is considering a change to the commission arrangement where the company would pay each salesperson a salary of $1,500 per month plus a commission of 2 percent of the sales made by that salesperson. What is the amount of total monthly car sales at which Willard Motors would be indifferent as to which plan to select? (CMA adapted)

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Cost Management Accounting And Control

ISBN: 101

6th Edition

Authors: Don R. Hansen, Maryanne M. Mowen, Liming Guan

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